I would venture a guess that the oldest question from student to teacher:

“Why are we learning this? It has no piratical application in the outside world.”

Guess what? We have to be more concerned with math as a business owner that as a student. Why…you need math to know your results. Every ad (marketing campaign) has to be traced to know if it was profitable.

However many businesses have no clue if their marketing works. All because they do not know their math. They go by gut feeling if the marketing is working. There is no connections between marketing and customers walking through the doors.

Look at sports professionals. They know their math…Batting averages, earned run averages, free throw percentages, shooting percentages, yards per carry, completion percentages, driving yards from the tee, putts on green.

What are your key stats for your window cleaning business? ROI for advertising, Life time customer value, dollars per hour, closing ratio.

Lets say you average $250 per house. How much money are you willing to spend to get a new customer? $0, $20, $100, $200? I know as little as possible. Would you spend $250? Sounds crazy right? Why waste all the money to get one new customer. Lets say that customer calls you twice per year for window cleaning. In/Out in the spring, and out in the fall for a total of $400. Let us also say this customer stays with you for seven years before moving away. The total amount that customer spends with your window cleaning company is $2800. The new question becomes would you spend $200 to get $2800 back? I would guess you could not get down to the bank fast enough to start making this trade.

Another math example. You are considering raising your prices. What will happen to the business if customers start to switch to another window cleaner? Here is an email I answered on Gary Mauer’s Window cleaning network:

In Lawrence Steinmetz’s book “How to sell at margins higher than your competitors”, he talks about raising your prices. He states that you could lose 30% of your customers, and still make more money. And most businesses do not come close to the 30%.

You said that you have raised from $150 to $250. 50-80% increase averages out to 65%. Using those numbers you could lose 40% of your customers, and still gross the same. 100 customers at $150 is $15,000. 60 customers at $250 is $15,000. Your profits would increase, because your costs would go down. Less customers to service. Plus you would have more openings in your schedule for better paying customers.